The Ministry of Land, Infrastructure and Transport announced on the 23rd that it signed a business agreement for a pilot project to prevent jeonse fraud with KB Kookmin Bank, Shinhan Bank, Hana Bank, NH Nonghyup Bank, and Korea Real Estate Board at the Seoul Federation of Banks.
This agreement is a follow-up measure to the 'Jeonse Fraud Prevention and Damage Support Plan' announced last month. Banks will verify the status of the issuance of a fixed date certificate before executing mortgage loan approvals. This is to prevent cases where the landlord obtains a senior mortgage loan before the tenant's opposability takes effect (at 0:00 the day after the move-in report), which weakens the protection of the tenant's deposit.
Including Woori Bank, which started first on January 30, all five major domestic commercial banks will participate in the pilot project. The Ministry of Land oversees the operation and system of the real estate transaction management system, and the Korea Real Estate Board provides banks with the status of fixed date certificate issuance.
The four banks that signed the agreement on this day (a total of 3,217 branches nationwide) will sequentially start the pilot project from May. KB Kookmin Bank will take the lead first by utilizing its existing network. The other banks will start from July once the Korea Real Estate Board establishes a new linked system that provides lease information from the Real Estate Transaction Management System (RTMS).
Minister Won Hee-ryong of the Ministry of Land said, "I hope banks thoroughly verify the issuance of fixed date certificates and tenant deposits during the loan screening process so that jeonse fraud exploiting the fact that the tenant's opposability takes effect at midnight the next day can no longer take root."
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